MATERIAL- DOCX

Title	MATERIAL-
Author	Angel Cayanan
Pages	23
File Size	74.3 KB
File Type	DOCX
Total Downloads	213
Total Views	296

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Description

MATERIAL 14: FOREIGN CURRENCY TRANSACTIONS WITH AND WITHOUT HEDGING TRANSACTIONS FOREIGN CURRENCY WITHOUT HEDGING I - Importing Transactions On December 1, 2009, Petra Corporation, ordered equipment FOB shipping point from an American Company for US $ 10, 000. The equipment was shipped and invoiced to Petra on December 16, 2009. Petra paid the invoice on January 15, 2010. Relevant spot rates for US dollars on the respective dates are as follows: Buying Spot Rate Selling Spot Rate 1-Dec-09 P 48.50 P 49.00 16-Dec-09 P 48.90 P 50.00 31-Dec-09 P 49.50 P 51.00 15-Jan-10 P 50.00 P 50.50 Required: 1. Prepare all the entries on Petra Corporation's books to record the above transactions. 2. Determine the following: a. Foreign Exchange gain or loss on: a.1 December 16, 2009 a.2 December 31, 2009 a.3 January 15, 2010 3. On December 31, 2009: b.1 Accounts payable b.2 Equipment 1...